4.1. ERMUSR 05-12-2009 - Laserfiche WebLink

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Page 2 of 7 reference to Temporary Regulation Sec. 1.274-5T (k) (50 FR 46088, 1985- 2 CB 809 (1985)). These proposed regulations incorporate the text of Sec. 1.274-5T (k) and add clearly marked public safety officer vehicles as a new type of qualified nonpersonal use vehicle, listed along with ~ arly marked police and fire vehicles at Sec. 1.274-5(k)(2)(ii)(A). c. .arly marked public safety officer vehicles are added to the definition of clearly marked police and fire vehicles at Sec. 1.274- 5(k)(3), and an example is added at Sec. 1.274-5(k)(8). (See Sec. 601.601 (d) (2) (ii) (b) . ) Explanation of Provisions Section 274 (d) provides that a taxpayer is not allowed a deduction or credit for certain expenses unless the expense is substantiated. These substantiation requirements apply to expenses incurred in the of use of any listed property (defined in section 280F(d)(4)), which includes any passenger automobile and any other property used as a means of transportation. Section 274 (d) does not apply to any qualified nonpersonal use vehicle as defined in section 274(1). Section 274(1) provides that a qualified nonpersonal use vehicle is any vehicle which by reason of its nature is not likely to be used more than a de minimis amount for Aersonal uses. The legislative history to section 274(1) provided a list of qualified nonpersonal use vehicles and identified a number of examples of qualified nonpersonal use vehicles such as school buses, qualified specialized utility repair trucks, and qualified moving vans. The legislative history indicated that Congress wanted the Commissioner to expand the list to include other vehicles appropriate for listing because by their nature it is highly unlikely that they will be used more than a very minimal amount for personal purposes. H.R. Rep. No. 99-34, at it (1985). Passenger automobiles such as sedans and sport utility vehicles are ~ erally not exempt from taxation as qualified nonpersonal use ~ icles because by design they can easily be used for personal purposes. However, _unmarked law enforcement vehicles and clearly marked police and fire vehicles are included in the list of qualified nonpersona use vehicles set forth in the legislative history to section 274(1) and incorporated into the proposed and temporary regulations. e IRS and an [ [Page 32501] ] the Treasury Department have become aware of a need for additional category of vehicles to be included in the list of qualified nonpersonal use vehicles. Clearly marked vehicles provided to Federal, state and local government workers who respond to emergency situations do not satisfy the current regulations governing qualified nonpersonal use vehicles if the individual workers are not employed by either the fire department or police department. Accordingly, the proposed regulations add clearly marked public safety officer vehicles to the list of qualified nonpersonal use vehicles so that emergency responders receive the same treatment whether they work for the police department, fire department or another department of state or local government. A clearly marked public safety officer vehicle is a vehicle owned or leased by a governmental unit or any agency or instrumentality thereof, that is required to be used for commuting by a public safety officer as defined in section 402(1)(4)(C) who, when not on a regular shift, is on call at all times, provided that any personal use (other- t n commuting) of the vehicle outside the limit of the public safety icer obligation to respond to an emergency is prohibited by such governmental unit. A public safety officer vehicle is clearly marked if, through painted insignia or words, it is readily apparent that the vehicle is a public safety officer vehicle. ~..-____ http://frwebgate3.access.gpo.gov/cgi-bin/waisgate.cgi?WAISdocID=09682228956+4+0+0&WAISacti... 6/10/2008